Tiny True North Gems Inc. is putting together a low-cost project to mine rubies in Greenland. The total project capital cost is only $41 M which bodes well in these days of tight money.
Rubies were found in Greenland in the 1960s. True North Gems began summer exploration programs in 2004 and has returned every year since. The Aappaluttoq project is located in southwest Greenland, approximately 150 kilometres south of the capital Nuuk.
The Aappaluttoq project contemplates an open pit mine, the installation of a process plant, and associated support infrastructure. The operation will be seasonal, producing up to 25,000 tonnes of ore and 430,000 tonnes of waste per year. A rough corundum concentrate will be produced at the minesite and shipped for further processing at the Company’s facility in Nuuk. The mining operation will be a typical open pit operation. Mining will use conventional blast, load and haul equipment mining up to 450,000 tonnes of total material over an eight month operating season from beginning of April to the end of November each year.
During operations, the Company estimates a site workforce of 63 people seasonally at Aappaluttoq and 14 to 21 in Nuuk once full production is reached. After a period of training, the Company expects that all positions can be occupied by Greenlanders with few exceptions.
A ruby is a pink to blood-red colored gemstone, a variety of the mineral corundum (aluminium oxide). The red color is caused mainly by the presence of the element chromium. Its name comes from ruber, Latin for red. Other varieties of gem-quality corundum are called sapphires. The ruby is considered one of the four precious stones, together with the sapphire, the emerald, and the diamond. Rubies have a hardness of 9.0 on the Mohs scale of mineral hardness. Among the natural gems only moissanite and diamond are harder, with diamond having a Mohs hardness of 10.0 and moissonite falling somewhere in between corundum (ruby) and diamond in hardness.
True North Gems Inc. is a Vancouver based junior (ticker = TGX on TSX-V). It has a market cap of $10 M. Its shares trade at $0.05. A year ago it traded at $0.09.
The company has forged relationships with cutting facilities in Asia. The market for rubies is not well known to investors and their is plenty of risk with this project. The company has lined up two thirds of the project financing and has kept costs low. This project is small and the company nimble—two good reasons it might meet with success.